Rewards credit cards
Get the best rewards credit card for you with up to 200,000 bonus points, cashback and premium perks up for grabs.
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Rewards credit cards are the easiest way to rack up bank rewards, frequent flyer points or cashback as you spend. If you choose a rewards card that best fits with how you spend money – and use it wisely – it can give you a way to get "something for nothing" on purchases you were going to make anyway. In this guide, you can find the best credit card for points for you and weigh up your options. Offer ends 03 May 2021 Eligibility criteria, terms and conditions, fees and charges apply The American Express Explorer Credit Card offers 90,000 bonus Membership Rewards Points, a $300 statement credit and up to 2 points per $1 spent, uncapped.
Receive 90,000 bonus Membership Rewards points
Plus a $300 Statement Credit
Rewards Credit Card Offer
Offer ends 03 May 2021
Eligibility criteria, terms and conditions, fees and charges apply
The American Express Explorer Credit Card offers 90,000 bonus Membership Rewards Points, a $300 statement credit and up to 2 points per $1 spent, uncapped.
Compare the best rewards credit cards 2021
When you get a new credit card, you can usually take advantage of sign-up offers for bonus points when you spend a certain amount. These can give you a huge head start on building your rewards balance. Don't forget to check that when comparing cards.
How do rewards credit cards work?
A rewards credit card earns points for every $1 you spend on purchases in Australia and overseas (including online). The points are credited to your account or a linked loyalty program, where you can redeem them for rewards. What you'll get for your points can range from flights and hotels to gift cards, cashback and retail items.
These rewards can help you get more value from your spending. But rewards credit cards typically charge higher interest rates and annual fees than other types of cards. So you'll get more bang for your buck if you pay your balance in full each statement period (to avoid interest) and if you can earn enough points to outweigh the annual fee.
Types of credit card rewards programs in Australia
Frequent flyer programs
If you're a member of a frequent flyer program, you can use a credit card to earn more points or miles for your existing frequent flyer account. There are two ways you can earn frequent flyer points with a rewards credit card in Australia:
- Frequent flyer points per $1 spent. These credit cards are directly partnered with a frequent flyer program and earn frequent flyer points on your eligible spending. Points are automatically added to your frequent flyer account once a month (or at regular intervals). In Australia, the main frequent flyer credit cards are linked to Qantas Frequent Flyer, Velocity Frequent Flyer and Emirates Skywards.
- Transfer credit card rewards to frequent flyer points. A lot of rewards credit cards let you transfer points to partnered frequent flyer programs. This gives you more flexibility if you fly with a number of airlines or don't travel very often. It can also be a good option if you want to earn points with a program that isn't directly linked with an Australian credit card (e.g. Singapore Airlines KrisFlyer). But the number of frequent flyer points you get is usually different to how many credit card points you have. For example, every 2 card points could get you 1 frequent flyer point. This is known as the point transfer or exchange rate and can affect the value you get from your points.
As well as partnerships with frequent flyer programs, many credit card reward programs let you use points for flights, travel upgrades, accommodation, car hire and travel experiences without needing to transfer them first. This can be handy if you want the option of travel rewards but don't want to limit yourself to earning points through just one frequent flyer program.
Bank and credit card rewards programs
Many credit card companies in Australia have their own rewards programs that give you a mix of ways to use points, with rewards such as travel, retail items, gift cards, credit on your account or point transfers to frequent flyer and other loyalty programs. The credit card rewards programs you can choose from include the following:
Instant reward options on credit cards
Some reward credit cards give you a way to use points instantly when you're shopping with a partnered retailer. For example, if you have a CommBank Awards credit card, you can redeem your points in-store at Myer or Flight Centre. Or, if you have an American Express Membership Rewards card, you can shop with points at Ticketmaster and David Jones (including online).
Cashback credit cards
These credit cards give you a way to get cash rewards for your spending, either in the form of credit back on your account or vouchers you can spend. Some cashback credit cards give you a set percentage of your regular spending as cash back on your account, while other cards come with introductory offers that provide a one-time account credit or voucher when you meet the spend requirements.
You can also get cashback in the form of gift cards when you have a rewards or frequent flyer credit card that offers different ways to use your points. Just look for the "cash" or "gift cards" category of your rewards program to see what options are available.
Retail and supermarket rewards credit cards
These rewards credit cards offer you points, discounts and other perks when you shop with a particular supermarket or major retailer, such as Coles, Woolworths, Myer, Kogan or David Jones. But you can still use them for spending at other shops and businesses (just like any other credit card). The following table gives you some examples of how these programs work.
|David Jones American Express & David Jones American Express Platinum Card||Earn American Express Membership Rewards or Qantas Points for purchases in David Jones and everywhere else. You can also enjoy exclusive shopping benefits at David Jones, such as complimentary delivery and interest-free plans for eligible purchases. The platinum card also offers complimentary travel insurance and airport lounge access.|
|Coles No Annual Fee, Coles Rewards Mastercard & Coles Low Rate Mastercard||The Coles No Annual Fee and Rewards Mastercard both earn Flybuys points at Coles Supermarkets and everywhere else. The Coles Low Rate Mastercard offers points per $1 spent at Coles Supermarkets (on top of your regular Flybuys points). These credit cards also include your Flybuys membership barcode on the back, so you won't have to pull out your Flybuys card when you're shopping at Coles or another Flybuys partner.|
|Woolworths Everyday Platinum||Earn points on your credit card spending, which are then converted to Woolworths Shopping Cards every four months. Other benefits include 10% off your shop at Woolworths once per month and details for your Everyday Rewards membership on the back of the card.|
|Kogan Money Black Card||Earns Kogan rewards points per $1 spent, which you can use to pay for Kogan.com purchases or for payments to your card. Another benefit is complimentary Kogan First Membership (usually $99), which gives you access to membership deals, free delivery on selected purchases and other perks.|
If you often shop with a particular store or brand, you can learn more about credit cards linked with shopping loyalty programs in Finder's guide to retail rewards credit cards.
Pros and cons of rewards credit cards
With so many rewards credit cards to choose from, it's wise to think about how you would use one, what rewards you'd get the most value from and your overall financial situation. Then you can weigh up the other benefits, costs and features to help you find the right rewards card for you.
- Points for spending. The most obvious perk of these cards is that you earn rewards of your choice, for money you were going to spend anyway. These could be credit card points, frequent flyer points, cashback and more.
- Introductory offers and deals. When you apply and get approved for a new rewards credit card, you often have the chance to earn a bunch of bonus points when you spend a certain amount in the first few months.
- Perks. Rewards credit cards often come with extra perks like travel insurance, purchase insurance, concierge services and lifestyle and entertainment offers. These will usually influence the annual fee.
- Higher rates and fees. To pay for the points and perks, these cards typically charge higher ongoing interest rates and annual fees than other cards. This could add to your costs, especially if you carry a balance from month to month.
- Temptation to overspend. The promise of rewards or frequent flyer points can lead you to spend more than you usually would. But the cost of overspending can cancel out the value you'd get from any points or perks you'd earn.
- Rewards limitations. While some rewards cards let you earn unlimited amounts of points, many set spending thresholds that cap your ability to earn rewards. If you often spend more than that cap, it will limit how much value you get from the card.
Citi Rewards Card - Bonus Points Offer100,000 bonus points (worth $460 in gift cards) when you spend $3,000 in the first 90 days. $49 first year annual fee ($149 thereafter).
How to compare rewards credit cards in Australia
From earning points to the rewards you want to redeem, here are some of the questions and factors to think about when you're comparing rewards credit cards:
How can I earn points?
- Bonus point offers. Rewards credit cards that offer bonus points for new cardholders give you a simple way to boost your point balance, but take note of the offer details before you apply. Usually, you need to meet a spend requirement in a set period of time to score bonus points. So make sure that this requirement fits with your budget.
- Points per dollar. Also known as the earn rate, this is how many points you'll earn for your spending. The higher the better, but a card that offers at least 1 point per $1 on eligible transactions could be considered good value.
- Point expiry and caps. Some credit card reward points expire after a certain amount of time and some have a limit on how many points you can earn in a month or year. Make sure these restrictions don't limit you by looking for cards that have an expiry that fits with your goals and a points cap that is higher than what you usually spend.
What's the value of the rewards?
- Point values. To work out the value of your rewards, consider how many points you would need to redeem for a specific reward. For example, let's say you need 12,000 points to get a $50 gift card and your credit card has an earn rate of 1 point per $1 spent. You would need to spend $12,000 before you could redeem the $50 gift card. Breaking down the rewards like this can help you determine whether it's worth your time and money.
- Rewards partners. Rewards programs often partner with retailers and businesses to give you more ways to use your points. You may also have the opportunity to earn bonus points when you shop with partner stores. Look for a credit card rewards program that has partnerships with your favourite brands and products so you can take advantage of these options.
- Redemption limitations. Some rewards programs have blackout periods when you may not be able to make redemptions, or limits on items in the rewards store. Check the fine print for this information and consider the impact it could have on you.
Table: How much do you need to spend to get rewards?
As different gift cards can have different point redemption values, we have focused on digital gift cards from popular retail brands and options including WISH (Woolworths Group), Coles, Myer and David Jones. We have also included the amount you'd need to spend in order to earn those points, based on common earn rates of 0.5 points per $1 and 1 point per $1. Finally, we've included the range of annual fees for personal credit cards associated with each program.
|Rewards program||Points needed for $100 gift card||Popular card and ongoing annual fee||Spend required for $100 gift card|
|American Express Membership Rewards||20,000||Explorer: $395||2 points per $1: $10,000|
|ANZ Rewards Program||22,225||Rewards Platinum: $95||1.5 points per $1: $14,817|
|Bankwest More Rewards Program||40,000||More Platinum: $160||2 points per $1: $20,000|
|Bendigo Bank Rewards||37,040||Platinum Rewards: $89||1.5 points per $1: $24,694|
|BOQ Q Rewards||35,800||Platinum Visa: $129||2 points per $1: $17,900|
|Citi Rewards Program||22,300||Rewards Card: $149||1 point per $1: $22,300|
|CommBank Awards||21,000||Platinum Awards: $249||1 point per $1: $21,000|
|Flybuys Rewards||20,000||Coles Rewards Mastercard: $99||2 points per $1: $10,000|
|HSBC Rewards Plus||24,000||Platinum: $129||1 point per $1: $24,000|
|Qantas Frequent Flyer||From 17,360||Qantas Premier Platinum: $299||1 point per $1: $17,360|
|Suncorp Bank Rewards||22,300||Clear Options Platinum: $129||1.25 points per $1: $17,840|
|Velocity Rewards||19,499||Virgin Australia Velocity Flyer: $129||0.66 points per $1: $29,249|
|Westpac Altitude Rewards||From 21,000||Altitude Platinum: $150||1 point per $1: $21,000|
|Everyday Rewards||20,000||Everyday Platinum: $49||1 point per $1: $20,000|
Rates and fees correct as of March 2020.
Based on this table, we can see that the minimum spend required for a $100 gift card or equivalent is $10,000 with American Express Membership Rewards or Flybuys where your credit card offers 2 points per $1 spent. In comparison, the maximum spend required for a $100 gift card would be $29,249 with a Virgin Money credit card that earns 0.66 points per $1 spent. While this doesn't factor in any sign-up bonus points or tiered earn rates, you should make sure you'll get enough value from the card on an ongoing basis before you apply.
Example: Is the Amex Platinum Edge worth it?
The American Express Platinum Edge sports an annual fee of $195. To make this card worth it, you'd have to take advantage of enough of the card's perks and features to outweigh this $195 fee in value. Here are a few ways you could create that value.
|Annual Travel Credit||$200||Must book through Amex Travel|
|Total||$200||Total value of perks excluding rewards and insurance|
|3 Membership Rewards / $1||-||At major supermarkets and petrol stations|
|2 Membership Rewards / $1||-||In foreign currency, overseas and online|
|1 Membership Reward / $1||-||On all other eligible purchases|
|40,000 Membership Rewards points||$200||Based on the average spend of $1,800/month at an average 2 pts/ $1. Valued using Coles gift card|
|Total||$400||Total approximate value of perks & points|
|Purchase Protection Cover||Varies||Maximum of $2,500/event or $20,000/year. Excess of $50/claim|
|Refund Protection Cover||Varies||Maximum of $500/item or $2,000 per year. Item must be worth at least $50|
|Buyer's Advantage Cover||Varies||Maximum of $10,000/year. Extends warranty - items must be worth $10,000 or less|
|Transport Accident Cover||Varies||Maximum benefit of $300,000|
|Travel Inconvenience Cover||Varies||Maximum benefit of $4,000|
|Medical Emergency Expenses Cover||Varies||Maximum benefit of $2.5 million. Excess of $250/claim|
|Baggage, Money and Documents Cover||Varies||Maximum benefit of $10,000. Excess of $250/claim|
|Travel Cancellation Cover||Varies||Maximum benefit of $10,000. Excess of $250/claim|
|Personal Liability Cover||Varies||Maximum benefit of $1 million|
What are the costs?
- Annual fees. Most rewards credit cards charge an annual fee. The value of the rewards you redeem should be higher than the cost of the annual fee to make it worthwhile. You can also compare rewards credit cards that offer no annual fee – just remember to check if the annual fee is waived in the first year or $0 for life.
- Purchase interest rates. Rewards credit cards often have high standard interest rates on purchases. Credit cards that offer interest-free days give you a way to avoid interest charges on your purchases, but usually only if you pay your balance in full by the due date on each statement. If you think you'll carry a balance, factor in the cost of interest when you're looking at how much value you'll get from the card. If the interest ends up costing you more, you could check out low-rate credit cards instead.
- Foreign transaction fees. Many credit cards charge a fee for transactions made overseas or with an international retailer online. This is usually 2-3.5% of the total transaction. If you're planning to use a rewards card for travel or to shop online with businesses based overseas, make sure you look at this fee before choosing a card – especially for any card that offers more points for foreign transactions. You can compare cards with no foreign transaction fees in this guide.
- Balance transfer interest rates. Some rewards credit cards also come with 0% balance transfer offers, but you won't earn points for any balance that you transfer to the new card. Plus, any new purchases will attract the card's purchase interest rate. If you have credit card debt that's collecting interest, think about paying it off completely before you look at a rewards card.
- Cash advance interest rates. If you use a rewards credit card for a cash advance transaction, such as getting money from an ATM, you will be charged interest at the cash advance rate. This rate could be as high as 22% p.a. Cash advances usually don't earn reward points either.
Are there any complimentary extras?
Rewards credit cards often come with a variety of additional features that can add value to the account you choose. Popular perks include the following:
Rewards programs give you a way to get extra value from paying with a credit card – but you need to look at the costs as well as the perks to decide if a rewards credit card is worth it. So, if you're interested in earning points, cashback or other rewards as you spend want a rewards card, you can start by comparing a range of credit cards based on the rewards program, sign-up bonus point offers, costs and your spending habits. You can then read reviews of individual cards, check your eligibility and apply for a card that fits your needs.
Frequently asked questions about rewards cards
What is an eligible transaction on a rewards credit card?
Each rewards program and credit card company has a different definition of which transactions earn points. Generally, most of your everyday purchases will earn points, including spending at retail stores, supermarkets and petrol stations. Transactions that usually don't earn points are balance transfers, government charges (including ATO payments), BPAY transactions, cash advances, account fees and account charges. Check the rewards program's terms and conditions for a full list of eligible and ineligible transactions so you know when you will earn rewards.
How do I redeem credit card reward points?
The steps you need to take to redeem your points will vary between credit cards and reward programs, but you can usually expect to have to do the following:
- Log in to your account. If you're redeeming points online, you'll need to log in to your credit card or rewards program account to make redemptions. Once you have logged in, it's usually a simple process of going to the "Rewards" section and then selecting "Use points" and following the prompts.
- Make sure you have enough points for your reward. You need a certain number of points to redeem each reward (e.g. 12,000 points for a $50 gift card). If you don't have enough points, you may have to wait until you earn more points or consider other options.
- Check if points plus pay is offered. Many credit card and frequent flyer reward programs allow you to use a combination of points and money to redeem rewards. This option is usually available for a selection of rewards, such as travel or merchandise and gives you more flexibility if you haven't earned enough points for your chosen reward.
- Confirm your chosen reward. Once you've found the reward you want, click through to the redemption process and follow the prompts to complete your redemption.
Who can apply for a rewards credit card?
To apply for a rewards credit card, you need to meet the bank or lender's eligibility criteria. The most common criteria include the following:
- Minimum income requirement. Because rewards cards often have higher interest rates and annual fees than other types of cards, the minimum income requirement is usually higher as well. It can range from $35,000 for a basic rewards card to $100,000 per year for a super premium option and everything in between.
- Cardholder status. Many rewards credit cards require you to be a new cardholder in order to take advantage of a bonus points promotion.
- Age. To apply for any credit card in Australia, you'll need to be at least 18 years old.
- Residency status. Some lenders require you to be a citizen or permanent resident to be approved, while others allow visa holders and temporary residents to apply as well.
- Credit history. All credit cards require you to have a clear history and not be an undischarged bankrupt or have any judgements against you.
If you're eligible to apply, you'll also be required to provide documents including payslips and proof of identification. The provider will then assess the details and documents you provide to determine whether you'll be approved for the account.
How can I meet the minimum spend requirements for bonus points?
If you get a credit card with a bonus points offer, you usually need to spend a certain amount in the first few months or over another period of time. With that in mind, below are some examples of different ways to meet the minimum spend requirements.
- Booking travel
- Buying major household items (e.g. a lounge or fridge)
- Buying a new laptop, tablet, phone or other tech
- Pre-paying your health insurance or other bills
- Paying for car services or repairs
- Seasonal shopping (e.g. school holidays, Christmas)
- Paying for everything with your credit card
It's important to only spend what you can afford to pay off so that you don't end up with interest charges that take value away from the points.
Are credit card bonus point offers worth it?
Bonus points are only really worth it if you can get more value from them than what you're paying for the credit card. When you're comparing rewards credit cards with bonus point offers, ask the following questions to decide if it's worth it:
- How much is the annual fee? Reward and frequent flyer credit card annual fees can quickly outweigh the value of rewards, even if you're getting thousands of bonus points.
- How much interest will I pay? Look at the interest rate for purchases and the minimum spend amount to estimate how much you could end up paying if you carry a balance after meeting this bonus point requirement. For example, if the minimum spend requirement was $3,000 in 3 months on a card with a 19.99% p.a. purchase rate and it took you 6 months to pay it off, you'd be charged around $177 in interest.
- How much are the bonus points worth? Look at the value of the points based on what rewards you want to redeem. For example, you could redeem 60,000 bonus Qantas Points for a return business class flight between Sydney and Adelaide (55,200 points) or $275 worth of Woolworths digital gift cards (56,970 points for one $250 card and one $25 card). Finder analysis shows that with Qantas Points, flights usually offer more value. It's worth looking at a few reward options for any card offering bonus points. You can also calculate the dollar value of your points in a few steps.
- How long does it take to get bonus points? The time it takes for bonus points to be added to your reward or frequent flyer account could be anywhere from a few days to several weeks after you have met all the offer requirements. If you want the points for a particular reward, this timeframe could help you decide of an offer is worthwhile for you.
Pictures: Getty and Shutterstock
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